Circle’s co-founder and CEO Jeremy Allaire shares his “Reflections on Post-SVB Market Dynamics” in a series of tweets. Allaire believes to be “getting lots of color and perspective from the market,” as he foresees “a large-scale risk-off from USD that is exposed to US banks and US regulatory risk.”
Sharing his views on the post-SVB market turmoil, Jeremy Allaire tweeted:
Reflections on Post-SVB Market Dynamics
— Jeremy Allaire (@jerallaire) March 23, 2023
1/ We are getting lots of color and perspective from the market, and wanted share some of what I am seeing. There seems to be a large-scale risk-off from USD that is exposed to US banks and US regulatory risk.
Allaire goes on to state that there exists a “Deep market anxiety about general exposure to the US financial system,” more so as the ensuing “regulatory actions on crypto” is “aggressive,” with the potential “risk of a large scale US banking system failure.”
He flags the instance that those who were apparently seeming to be in “the strongest position with US regulation and US banking system integration,” are now “un-safe”, with their assets potentially poised to be “stranded.”
There is also a “broader macro risk,” cautions Jeremy Allaire, “that is driving rotation from USD into BTC/ETH.” Since there already is a lot of buzz surrounding this instance, Allaire opts to refrain from any more “commentary.” The policymakers in the US, per Allaire, must begin thinking “very carefully” about the future.
Jeremy Allaire reportedly believes the market participants are shifting into platforms with no oversight, totally opaque bank and risk exposures, and histories of lax financial risk/integrity controls. He cautions this would not “end well.
As for Circle, Allaire ensures the company will continue “doing what we have always done, operate within a regulatory perimeter, held to high standards, with the highest level of transparency in this industry, and the strongest financial market infrastructure partners that we’ve ever had.”
Mentioning the @congressdotgov and @WhiteHouse Twitter handles, Allaire says,
I have not seen a situation in the past 10 years where clear, coherent and pragmatic policy is so urgently needed. We are in serious risk of seeing an entire strategic technology arena slip away from US leadership.
As per Allaire, the stablecoin USDC has “not missed a beat.” He reassures that USDC has “never failed to mint or redeem USDC for $1,” even amidst the recent “stress test.” He shares the statistics of having “redeemed $192.4B USDC at $1, and issued $176.9B at $1.”
